Background Check Checklist for Employers [2025]

As an employer, you must ensure your background checks are consistent and legally compliant.

This guide provides an in-depth checklist to help your HR staff complete each step thoroughly while avoiding common mistakes that could increase liability risks.

Your Complete Background Check Checklist

1. Stay up-to-date on Applicable Laws

When you run background checks, you must comply with laws at the local, state, and federal levels.

While state laws vary widely, there are a few you should watch for.

Many states and local governments have adopted ban-the-box laws that control when in the hiring process you can check an applicant’s criminal history information.

Some states and cities, such as New York City, also have restrictions on employment credit checks, while some states, like Colorado, ban salary history inquiries.

Consult legal counsel to ensure you have the most up-to-date information about local and state laws where you operate.

At the federal level, you should be aware of three main laws, including:

The Fair Credit Reporting Act (FCRA)

The FCRA is the most important background check law and applies to employers in every state.

A consumer privacy law, it protects individuals’ sensitive information that consumer reporting agencies (CRAs), including background check companies, gather, store, and report to third parties.

The FCRA’s 7-year rule prohibits CRAs from reporting specific information when it’s older than seven years and the position pays less than $75,000 annually, including:

• Civil lawsuits
• Civil judgments
• Arrests not ending in convictions
• Paid tax liens
• Debt collections
• Chapter 13 bankruptcies (Chapter 7 can be reported for 10 years)

While the 7-year rule doesn’t restrict the reporting of old criminal convictions, some states, including California and Colorado, have laws that prohibit reporting convictions older than seven years.

In states with expungement laws, convictions that have been expunged, sealed, or pardoned can’t be reported.

For employers, the FCRA requires them to provide notice to applicants on a standalone form that they conduct pre-employment background checks. They must also secure their written consent before initiating them.

When an employer decides not to hire someone because of information learned from a background check, they must complete the adverse action process before making a final decision.

Title VII of the Civil Rights Act of 1964

Title VII is the leading federal anti-discrimination law and prohibits workplace discrimination based on an applicant’s or employee’s protected characteristics.

The Equal Employment Opportunity Commission (EEOC) enforces Title VII and other federal anti-discrimination laws.

It has issued employer guidance about how they should handle criminal record information learned from background checks.

When an employer learns about a criminal conviction on a background check, they must assess the information individually and compare it to the job’s duties and workplace safety concerns before basing an adverse employment decision on the conviction.

Fair Chance to Compete for Jobs Act

The Fair Chance to Compete for Jobs Act (FCA) is a federal fair chance hiring law that applies to federal agencies and the companies that contract with them.

Under the FCA, federal agencies and contractors are prohibited from asking about criminal history or performing criminal background checks on applicants before they extend conditional employment offers.

The FCA prohibits federal agencies from contracting with companies that inquire about criminal history earlier in the hiring process.

2. Create a Thorough Policy

Before you start conducting background checks, create a thorough policy that adheres to all local, state, and federal laws.

Include information about the types of searches you’ll conduct for jobs at different authority levels and the reasons why.

Outline what HR staff must do before, during, and after the screening process.

3. Train HR Staff

Once you’ve finalized your background check policy, train the HR staff who will conduct them on your policy and the relevant laws that apply.

Include specific steps they must take throughout the process to remain compliant.

4. Provide Required Disclosures and Obtain Written Consent

The FCRA requires employers to notify applicants that they conduct background checks on a standalone form without extraneous information.

Make sure your FCRA disclosure complies with the law and is separate from other documents provided to applicants.

You must obtain the applicant’s written consent before you can order a background check. This consent can be signed on paper or electronically.

5. Choose a Reliable Background Check Provider

The quality of the background check company you choose can affect the reliability and accuracy of your reports.

Make sure your chosen provider is accurate, comprehensive, FCRA-compliant, and current.

At iprospectcheck, we continuously monitor changes to background check laws at the local, state, and federal levels to remain compliant.

We have extensive access to trusted information sources and use advanced research methodologies to locate up-to-date and accurate information about job candidates.

6. Select Relevant Searches

Choose only the searches relevant to the position you’re hiring for to avoid paying for unnecessary information.

Some common types of background searches you might consider include the following:

Identity Verification

Identity verification is an initial search background check providers perform to verify an applicant is who they claim to be and the records uncovered belong to them and not someone else.

Identity verification reveals the following information about a candidate:

• Legal name and any aliases used, including a maiden name
• Address history
• Date of birth

Criminal History Check

For an applicant with a criminal record, a criminal background check reports the following details:

• Criminal case number
• Jurisdiction
• Offense nature
• Offense severity (misdemeanor or felony)
• Offense date
• Disposition
• Disposition date
• Sentence (if available)

Note that expunged, sealed, or pardoned convictions can’t be reported.

Employment Verification

Employment verification discloses the following information about an applicant’s current and previous jobs:

• Employer name and address
• Employment dates
• Job titles/positions held

This search allows you to confirm that an applicant has accurately reported their employment history and identify any gaps that should be addressed.

Education Verification

Education verification discloses the following details about an applicant’s educational background:

• Institution name(s) and address(es)
• Enrollment dates
• Degrees/diplomas conferred

This search allows you to verify the claims the applicant has made about their educational qualifications.

Professional Licenses and Certifications

If you hire for credentialed positions, professional license verification shows the following details about the applicant’s license or certification:

• License/certificate validity
• License/certificate number
• Issuing body
• License/certificate type
• Licensee’s name
• Issuance and expiration dates
• Public discipline or sanctions

This information allows you to confirm that your applicant has the credentials necessary to perform the work.

Reference Checks

Reference checks involve contacting an applicant’s professional references to assess their skills and suitability for the position.

They can also help determine whether the applicant will fit in well with the company’s culture.

Motor Vehicle Records (MVR) Check

If you hire people who will drive as a part of their jobs, a motor vehicle records check reveals the following details:

• Driver’s license number
• License class/type
• Issuance date
• Issuing state
• Licensee’s full legal name
• Registered address
• Expiration date
• Suspensions/revocations
• Traffic citations
• Major traffic offenses

This information can help you determine whether the driver is safe and insurable.

Credit Check (When Applicable)

If you’re hiring for a position that involves handling money or accessing sensitive financial information, a pre-employment credit check might be a good idea.

This search reports the following information:

• Address history
• Names and aliases
• Address history
• Debt collection accounts
• Payment history
• Debt-to-income (DTI) ratio
• Bankruptcies
• Other indicators of financial distress or mismanagement

Drug Screening

Many employers perform pre-employment drug screens to check for a candidate’s recent use of illicit substances.

Most employers that perform pre-employment drug tests request screens for the following drugs:

• Cocaine
• Opiates/opioids
• Amphetamines/methamphetamines
• Phencyclidine (PCP)
• THC/marijuana*

* In some states, including Washington and California, pre-employment marijuana screens that reveal non-active THC metabolites can’t be used for employment decisions.

Make sure you know the laws that apply in your jurisdiction.

Continuous Monitoring (Optional)

Some employers request continuous monitoring of their employees post-hire.

These screens alert you if an employee has a new criminal conviction while working for you so that you can assess its relevancy to their job.

7. Review Findings and Take Action

When you receive your reports, carefully evaluate the information they include.

If you want to move forward with a candidate, contact them to schedule onboarding and a start date.

If you’re concerned about information in an applicant’s background check, complete the following steps as needed.

8. Assess Criminal Convictions Individually

Under Title VII, the EEOC directs employers to assess convictions carefully in balance with the position for which an applicant is being considered and workplace safety concerns.

Complete this assessment and retain documentation of it before you decide not to hire an applicant based on their criminal record.

9. Complete the Adverse Action Process When Necessary

If you want to deny employment to an applicant because of negative information you learn from a background check, complete the adverse action steps before making a final hiring decision:

• Send a pre-adverse action notice – Explain the information you’re concerned about and include a copy of the background check report that contains it.
• Give a reasonable time to respond – Give the applicant a reasonable amount of time to respond (generally, five business days) with evidence that the information is wrong or that they have been rehabilitated.
• Send a final adverse action notice – If you ultimately decide not to hire the applicant, send a final adverse action notice and include a copy of their rights under the FCRA and relevant state laws.

Common Mistakes Employers Should Avoid

1. Failing to Provide Required Notice or Obtain Proper Consent

Employers must provide notice to applicants and employees that they will conduct background checks and obtain written consent before they complete them.

If you fail to provide the required notice or obtain an applicant’s proper consent, you could face litigation.

Applicants can sue for monetary damages, and your company might also incur hefty civil penalties.

On a related note, make sure your disclosure form complies with the FCRA’s requirements and doesn’t include extraneous information.

For example, in Syed v. M-I, LLC, the Ninth Circuit Court of Appeals overturned the lower court’s decision and allowed the plaintiff’s lawsuit against an employer to proceed.

The employer’s background check disclosure form also included a liability waiver, which he alleged violated the FCRA’s standalone document rules.

2. Overlooking Legal Updates or Compliance Requirements

If you fail to stay current with the law or overlook your compliance requirements when screening applicants or employees, you could face civil lawsuits and civil penalties.

3. Applying Inconsistent Screening Practices

Only screening some applicants while not checking the backgrounds of others can expose your company to discrimination lawsuits, especially if you only screen members of a protected class.

You should conduct uniform screenings for all applicants at the same position level.

4. Relying Solely on Instant Online Databases

Instant online databases are not always accurate or reliable.

You could receive information that violates the FCRA when used for employment decisions and exposes you to liability risks.

It’s best to work with an experienced, reputable provider like iprospectcheck.

5. Treating Criminal Records as a Bar to Employment

If you automatically deny anyone with a criminal record, you could face discrimination lawsuits.

Individually assess convictions as they relate to the position to comply with the EEOC’s guidance under Title VII.

6. Skipping the Required Adverse Action Process

When you want to deny employment because of information you learned from a background check and fail to complete the adverse action process, your applicant has the right to sue you for monetary damages.

FCRA lawsuits can be expensive and difficult for employers to win, especially when their violations are obvious and flagrant.

Why Partner With iprospectcheck?

When you partner with iprospectcheck, you will enjoy the following benefits:

Enhanced compliance

We constantly research local, state, and federal laws to make changes with the laws.

This enhances your company’s legal compliance and reduces your liability risks.

Cutting-edge technology and integrations

Our advanced technology enables us to find relevant information about your candidates quickly and verify its accuracy.

Our software integrates with many applicant tracking systems (ATS), allowing you to initiate background checks with the click of a button and receive results within your candidate’s profile.

Smoother candidate experience

Our SwiftHire Mobile app allows your applicants to upload forms, answer requests, and track the background check process from their smartphones or other mobile devices.

This makes the process smoother and more enjoyable for your candidates and keeps them engaged with your hiring process.

Fast results

Because of our technology and research methods, we return many reports within a few hours to a couple of days. This allows you to make faster hiring decisions and reduce your time to hire.

Highly secure

We use advanced encryption technology to keep your candidates’ personal identifying information (PII) and other sensitive data secure.

Better accuracy

Our meticulous approach helps us ensure the accuracy of the information we provide, enabling you to make fully informed hiring decisions.

Start a Background Check with iprospectcheck

Using a background check checklist helps your HR staff maintain compliance with local, state, and federal laws.

Our background check checklist also aids consistency and uniformity for improved hiring.

To learn more about our background check services or to get a free quote, contact us today: (888) 509-1979.

DISCLAIMER: The resources provided here are for educational purposes only and do not constitute legal advice. Consult your counsel if you have legal questions related to your specific practices and compliance with applicable laws.